- Anzu helps brands place their ads inside video games.
- The company raised $48 million to hire staff to build out its executive suite and hire staff.
- Its CEO is surprised the metaverse didn’t take off over the last year, but thinks augmented reality is a better bet.
Inserting ads into video games — like as a billboard in a car racing game — is increasingly enticing to advertisers hoping to message hard-to-find Gen Zers.
The startup Anzu provides the tech and the video game partnerships to make that possible, and the company just raised a $48 million Series B round, led by Emmis Corporation, with additional participation from Evolution, Simon Equity Partners, and the investment arms of PayPal and Bandai Namco. The company last raised a $20 million round last year, bringing its total to $85 million.
Insider’s parent company Axel Springer is also an investor in Anzu.
Anzu will use its new funds to build out its leadership team and grow its US presence, said company, said company CEO and cofounder Itamar Benedy.
“We’re going to have more heavy hitter advertising executives to join our leadership team,” he told Insider. He also noted Anzu has a bunch of open positions around working with agencies, partners, client support, sales, and technical roles.
Benedy said a lot has happened over the past year to make this a good time for tech that pushes ads into video games, particularly “AAA” games, which are big budget and high profile, and are usually played on PCs or consoles. He said “tremendous progress” has been made getting AAA developers to open up their games to ad inventory. “After proving the model with mobile games and casual games, we’re moving into AAA games,” Benedy said.
Anzu, for instance, has extended its partnership with game maker Ubisoft after initial success with ad placement in “Trackmania” and “Growtopia.” The two plan to bring in-game ads to more of Ubisoft’s top titles. Benedy said Anzu works with five of the top 10 AAA game publishers.
Benedy also said that Anzu has improved its value proposition with advertisers because it’s better integrated with other adtech companies, like Integral Ad Science, so in-game ads can be independently measured. Anzu also works with ad-buying platform The Trade Desk so in-game ads can be bought using automation.
However, Anzu also had to change course a few times last year, due to the economic volatility. The company had planned to grow headcount to 150 by the end of 2022, but slowed down on that goal, and now has about 100 employees.
“Advertising dollars grew fast, but we always want them to grow faster,” Benedy said.
Also, Anzu is scaling back on its plans to invest heavily in the metaverse, which was all the rage in 2022.
“We still have plans for VR, but we’re in the business of selling eyeballs,” Benedy said. Metaverse activations need to see a meaningful userbase before justifying more investment. “The last thing we want is there are these metaverse parties and 40 people come.”
But while VR isn’t the big business Benedy had hoped, he thinks cloud-based gaming and augmented reality will be bigger opportunities, especially with Apple entering the AR space with its Apple Vision Pro device.
“As there’s more adoption, we’ll be able to bring a lot more value,” he said.
Read the pitch deck Anzu used to raise $48 million below.
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